Time Warner Cable Falls Most in Year on Customer Losses

Nov. 5 (Bloomberg) -- Time Warner Cable Inc., the second-largest U.S. cable-television operator, dropped the most in more
than a year after the loss of video customers dragged down
third-quarter earnings.

Time Warner Cable fell 6.4 percent to $91.93 at the close
in New York, the biggest one-day drop since October 2011. The
shares, which have gained 45 percent this year, were the biggest
decliner in the Standard & Poor’s 500 Index today.

Time Warner Cable lost 140,000 residential video
subscribers, more than the 128,000 that analysts had estimated.
The cable provider also added fewer Internet and voice customers
than analysts projected, a sign Time Warner Cable is struggling
to market the correct bundles of services to its customers, said
Paul Sweeney, an analyst at Bloomberg Industries.

“It’s a sloppy quarter across the board operationally,”
Sweeney said. “Time Warner Cable has long promoted its ability
to segment its subscribers. The results this quarter call into
question that marketing strategy.”

Net income rose to $808 million, or $2.60 a share, from
$356 million, or $1.08 a share, a year earlier, the New York-based company said today in a statement. Excluding one-time
items, earnings per share were $1.41, missing the $1.43 average
analyst estimate compiled by Bloomberg.

Hurricane Sandy

Damage from Hurricane Sandy, which struck the East Coast
last week, isn’t expected to be significant to the company’s
fourth-quarter results, the company said in a filing. Time
Warner Cable will credit customers for the time they lost
service because of the storm, the company said Nov 2.

Sales rose 9.2 percent to $5.36 billion, missing the
average estimate of $5.39 billion. Average revenue per user
among TV customers was $74.32, hurt by a decline in video-on-demand orders. That missed the $76.49 estimate of James
Ratcliffe, an analyst at Barclays Plc.

Time Warner Cable repurchased $500 million worth of shares
in the period, falling short of the $850 million estimated by
Craig Moffett, an analyst at Sanford C. Bernstein & Co. in New
York. The light repurchases were disappointing to investors who
anticipated more after Time Warner Cable received $1.1 billion
from Verizon Wireless for its wireless spectrum, a deal approved
by regulators in August, Moffett said.

The selloff dragged down other cable stocks as well.
Charter Communications Inc., the fourth-largest cable operator,
fell 2.9 percent to $72.94. Cablevision Systems Corp., the
fifth-largest U.S. cable provider, fell 1.6 percent to $16.53.
Both companies will report their own results tomorrow morning.